Crypto markets are down sharply after Fed Chair Jerome Powell and JPMorgan CEO Jamie Dimon both voiced regulatory concerns earlier this week.
RACHELLE AKUFFO: Keeping an eye on Bitcoin, trading down about 3 and 1/3 of a percent today, and of course, it’s been a rough week overall for the cryptocurrency. We heard Fed Chairman Jerome Powell’s hawkish tone. And that had investors searching for less risky assets. So let’s take a look at the interactive here, as we see that it’s down 3 and 1/3 of a percent there. But as we look for the week, we can see where it did take that turn after Jerome Powell’s comments, down about 3 and 1/2% for the week.
And let’s also take a look at Ethereum. A similar story there. That’s down more than 3%. But of course, that’s been doing even worse, getting additional pressure following the merge if we take a look back there, and we see how that’s been faring over the past month ever since that merger there, dropping as you can see about almost 22%.
Now you also have other news putting pressure on some of these other crypto tokens. On Friday, the Defense Advanced Research Projects Agency, or DARPA, said it’s launching a sweeping review of cryptocurrencies to assess national security and law enforcement threats to really crack down on illicit use.
So you’re seeing many of them pressured here, as we take a quick whip through. Really, the only one in the green at the moment is Dogecoin. That seems to be the only one that’s actually doing well on the day. We see a few of them in the green. Doge there, obviously, an Elon Musk favorite, but many of them still under pressure.
Now we are going to see that the IRS is also going to be digging into potential crypto tax evaders using crypto broker sFOX. And that’s at the request of the Southern District of New York. So you can expect more scrutiny ahead. And of course, illicit use potential, which was one of the many shots fired from JPMorgan Chase’s Jamie Dimon on crypto, as he and other bank CEOs testified this week. Now he really did re-up his disdain for crypto tokens. Take a listen.
JAMIE DIMON: You have to separate blockchain, which is real, DeFi, which is real, ledgers, tokens that do something and deliver information, money, ideas, simplify smart contracts. That’s one thing. I’m not a skeptic. OK, I’m a major skeptic on crypto tokens, which you call currency, like Bitcoin. They are decentralized Ponzi schemes. And the notion that it’s good for anybody is unbelievable.
RACHELLE AKUFFO: So he’s a fan of blockchain, though, and he did say that the bank actually uses it. But the individual tokens, he’s described as potentially and just insanity at this point, Seana.
SEANA SMITH: Yeah, Rachelle, the wild ride in Bitcoin this week clearly reflected in some of those crypto stocks. We can see Coinbase, it was lowered its price target from JP Morgan there down to $60. That stock getting hit today. Block getting downgraded by Mizuho earlier this week, slashing their price target from 125 to 57. So that really reflects the broader crypto environment right now and all that selling pressure that we’ve seen play out in the crypto space here over the last couple of months.